New Energy Metals Enters Into Options Agreements For Cobalt Projects
(Kitco News) - New Energy Metals Corp. (TSXV: ENRG) has entered into options agreements to acquire a 100% interest in three additional cobalt exploration projects in Chile’s past-producing cobalt district, the company announced Wednesday.
“These projects add to the two cobalt acquisitions announce earlier, and provide the company with a strong land position in the prospective San Juan cobalt district in Chile,” said Grand Ewing, president and chief executive officer of New Energy Metals. “We view the potential for the discovery of primary cobalt deposits on the projects as very good, based on historical records and the fact that only limited exploration has been conducted in the region in more than 60 years.”
The company said it chose the projects based on geological characteristics, historic workings, evidence of mineralization and proximity to past production. The company also said its initial exploration will center on historical data, regional mapping and prospecting, and sampling to identify priority areas for follow-up work. Officials said infrastructure is good and the district is 10 kilometers from tidewater.
The San Juan cobalt district includes several mines that produced cobalt and copper for several decades at the turn of the 20th century. The last closed in the mid 1940s. From 1903 to 1944, the district produced some 300,000 tonnes of cobalt ore grading 4% cobalt, plus some copper, New Energy Metals reported.
The options purchase sets out a schedule by which the company can earn a 100% interest in the projects, with cash and share payments. Over a period of up to two years, the cumulative payments for all of the projects would amount to $2.6 million and 2.4 million shares.
New Energy Metals completed an initial public offering in January and closed on $4.37 million financing in February. The principal project is the Cristal copper project in northern Chile, for which the company has an option to acquire a 100% interest.